Effective February 20th, 2024, the Indian government eliminated import duties and AIDC on raw cotton. This move, backed by industry demands, aims to make Indian cotton exports more competitive, particularly for value-added products.

Previously, a 11 per cent import duty (imposed since November 2022) burdened cotton imports. This, according to industry bodies like the Council, hindered export competitiveness. Responding to their appeals, the government abolished both the import duty and the AIDC for raw cotton classified under HS Code 52010025.

This policy change is expected to significantly benefit cotton exports. Manufacturers can now offer more competitive prices for value-added products like garments, making them more attractive in the international market. The Council anticipates a significant boost in export volumes due to this favorable policy shift.